DALLAS, Feb. 18 /PRNewswire-FirstCall/ -- SOURCECORP(R) (Nasdaq: SRCP),
one of the nation's leading providers of business process outsourcing
solutions, today reported fully diluted earnings per share of $0.43 for the
fourth quarter ended December 31, 2003. This represents a 13 percent increase
over the same quarter in 2002. Sequentially, earnings per share improved 8%
over the third quarter of 2003. Driven by stronger than expected project
revenue from Legal Claims Administration, revenues for the fourth quarter of
2003 were $112 million, an 11 percent increase over the third quarter of 2003.
Net income was $7.0 million, versus $6.7 million in Q4'02.
For the fiscal year ended December 31, 2003, SOURCECORP's fully diluted
earnings per share were $1.65, an increase of 4.4 percent over 2002 on
slightly lower revenues. The current year fully diluted earnings per share
benefited from our share repurchase program. During 2003, we acquired
1,306,979 shares at an average cost of $15.84 per share. Revenue for the full
year was $424 million, versus $429 million in 2002.
"During the past year, we took steps to strengthen the Company's strategic
position by increasing our investment in high caliber sales and IT personnel,
as well as technology. Even though we incurred these increased costs, we were
still able to generate earnings per share of $1.65," stated Ed H. Bowman, Jr.,
President and CEO of SOURCECORP. "Our sequential progress in revenue and
earnings since Q2, 2003 demonstrates the improvements we are making,
particularly in the fourth quarter, while absorbing the costs of the
investments noted above."
The Company closed sales during the fourth quarter of 2003 anticipated to
produce total revenue of approximately $28 million. Total new business wins
attained during 2003 were $125 million, below 2002's level of $139 million.
Mr. Bowman commented, "We are focusing on growing our pipeline in size as well
as quality, aiming for larger-sized accounts with multi-year terms. We expect
to sign several sizable contracts during the first half of 2004."
Summary of Financial Highlights
(in $ millions, except for earnings per share data)
(Unaudited)
Q3 2003 Q4 2002
Q4 2003 Amount Change Amount Change
Revenue $ 111.9 $ 100.9 11% $ 112.8 -1%
Operating Income 12.6 11.5 10% 12.3 3%
Net Income 7.0 6.6 6% 6.7 5%
Diluted EPS $ 0.43 $ 0.40 8% $ 0.38 13%
For the full year 2003, operating cash flow was $62.3 million versus
$67.8 million for 2002. Days Sales Outstanding decreased in sequential
quarters by one day to 42 business days. Year over year, the improvement was
also one business day. The Company's debt to total capital ratio decreased
from 23% at December 31, 2002 to 19% at December 31, 2003.
Company Financial Outlook
Looking ahead in 2004, we expect to see positive results from our
investments in people and technology. We are anticipating full year revenues
in the range of $435 to $450 million, and earnings per share in the range of
$1.70 to $1.80.
ABOUT SOURCECORP(TM)
SOURCECORP, Incorporated is a leading provider of value-added business
process outsourcing solutions to clients nationwide. SOURCECORP targets
information intensive, technology oriented, application driven industry
segments, such as healthcare, legal, financial services and government,
leveraging its expertise and experience in business processes for these and
other similar business profiles. Headquartered in Dallas, the Company employs
approximately 9,000 people and operates in over 40 states, Washington D.C. and
Mexico.
SOURCECORP is a component of both the S&P SmallCap 600 Index and the
Russell 2000 Index. In June 2001, the Company was cited among the Top 100 Hot
Growth Companies by BusinessWeek magazine. SOURCECORP has previously been
recognized twice by Forbes magazine as one of the 200 Best Small Companies,
based on return on equity, sales growth, and EPS growth, and by FORTUNE
magazine as one of America's 100 Fastest Growing Public Companies. For more
information about SOURCECORP's solutions, including case-study examples, visit
the SOURCECORP website at http://www.srcp.com .
The statements in this press release, which are not historical fact, are
forward-looking statements that involve risks and uncertainties, which could
cause actual results to differ materially from such forward-looking
statements. These forward-looking statements include, but are not limited to,
any financial estimates and projections included in this press release and the
Company disclaims any intention or obligation to update or revise such
estimates or forecasts, except as required by law. The aforementioned risks
and uncertainties include, but are not limited to, the risks of integrating
our operating companies, of managing our growth, of the timing and magnitude
of technological advances, of the occurrences of future events that could
diminish our existing customers' needs for our services, of a change in the
degree to which companies continue to outsource business processes, as well as
the risks detailed in SOURCECORP's filings with the Securities and Exchange
Commission, including without limitation, those detailed under the heading
"Risk Factors" in the company's most recent annual report on Form
10-K. SOURCECORP disclaims any intention or obligation to revise any forward-
looking statements, including financial estimates, whether as a result of new
information, future events, or otherwise, except as required by law.
SOURCECORP(R)
Condensed Consolidated Statements of Operations
In Thousands (Except Earnings Per Share)
(Unaudited)
Three Months Ended
December 31, September 30,
2003 2003
Total Revenue $111,866 $100,926
Cost of Services 66,098 59,657
Depreciation 3,769 3,607
Gross Profit 41,999 37,662
SG&A 29,285 26,098
Amortization 89 89
Operating Income 12,625 11,475
Other expense, net 1,015 555
Income before income taxes 11,610 10,920
Provision for income taxes 4,644 4,368
Net Income $ 6,966 $ 6,552
Weighted Avg. Shares
Basic 16,094 16,188
Diluted 16,298 16,355
Earnings Per Share
Basic $ 0.43 $ 0.40
Diluted $ 0.43 $ 0.40
SOURCECORP(R)
Condensed Consolidated Statements of Operations
In Thousands (Except Earnings Per Share)
(Unaudited)
Three Months Ended
December 31,
2003 2002
Total Revenue $111,866 $112,844
Cost of Services 66,098 69,183
Depreciation 3,769 3,612
Gross Profit 41,999 40,049
SG&A 29,285 27,669
Amortization 89 89
Operating Income 12,625 12,291
Other expense, net 1,015 1,547
Income before income taxes 11,610 10,744
Provision for income taxes 4,644 4,083
Net Income $ 6,966 $ 6,661
Weighted Avg. Shares
Basic 16,094 17,378
Diluted 16,298 17,373
Earnings Per Share
Basic $ 0.43 $ 0.38
Diluted $ 0.43 $ 0.38
SOURCECORP(R)
Condensed Consolidated Statements of Operations
In Thousands (Except Earnings Per Share)
(Unaudited)
Year Ended
December 31,
2003 2002
Total Revenue $424,087 $429,380
Cost of Services 251,914 259,399
Depreciation 14,379 14,284
Gross Profit 157,794 155,697
SG&A 108,295 103,851
Amortization 355 356
Operating Income 49,144 51,490
Other expense, net 3,555 6,599
Income before income taxes 45,589 44,891
Provision for income taxes 18,236 17,059
Net Income $ 27,353 $ 27,832
Weighted Avg. Shares
Basic 16,452 17,334
Diluted 16,565 17,609
Earnings Per Share
Basic $ 1.66 $ 1.61
Diluted $ 1.65 $ 1.58
SOURCECORP(R)
CONDENSED CONSOLIDATED BALANCE SHEETS
In Thousands
(Unaudited)
December 31, December 31,
ASSETS 2003 2002
CURRENT ASSETS
Cash $ 2,097 $ 3,217
Accounts receivable (net) 73,566 78,834
Deferred tax asset 6,072 9,012
Other current 7,111 6,247
Total current assets 88,846 97,310
Property, plant & equipment (net) 42,825 40,575
Goodwill and other intangibles (net) 328,036 321,340
Other noncurrent 10,566 8,382
Total Assets $470,273 $467,607
LIABILITIES AND STOCKHOLDERS' EQUITY
CURRENT LIABILITIES
Accounts payable and accrued liabilities $ 57,477 $ 58,029
Current maturities of long-term obligations 209 113
Income taxes payable 2,186 180
Total current liabilities 59,872 58,322
Long-term debt 73,390 89,640
Deferred taxes and other long-term
liabilities 25,923 16,969
Total Liabilities 159,185 164,931
STOCKHOLDERS' EQUITY
Common stock 162 175
Additional paid-in-capital 194,999 206,843
Deferred compensation (2,327) 0
Other comprehensive loss 0 (329)
Retained earnings 119,236 96,969
312,070 303,658
Less: Treasury stock (982) (982)
Total Stockholders' Equity 311,088 302,676
Total Liabilities and Stockholders'
Equity $470,273 $467,607
SOURCECORP(R)
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
In Thousands
(Unaudited)
Year Ended
December 31,
2003 2002
Net Income $ 27,353 $ 27,832
Adjustments to reconcile net income to
cash provided by operating activities
Depreciation and amortization 14,734 14,640
Deferred tax provision 9,345 10,633
Compensation expense on restricted
stock grants 623 0
Loss on sale of property, plant
and equipment 213 243
Changes in working capital 10,056 14,425
Net cash provided by operating activities 62,324 67,773
Net cash used for investing activities (26,519) (44,720)
Net cash used for financing activities (36,925) (27,018)
Net decrease in cash and cash equivalents (1,120) (3,965)
Cash and cash equivalents, beginning
of period 3,217 7,182
Cash and cash equivalents, end of period $2,097 $3,217
SOURCE SOURCECORP
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Related links:
http://www.srcp.com
Company News On-Call:
http://www.prnewswire.com/comp/117986.html
CONTACT:
Barry Edwards, EVP & Chief Financial Officer,
+1-214-740-6690, or Bryan Hill, VP & Chief Accounting Officer,
+1-214-740-6695, both of SOURCECORP, Incorporated
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